Receiver without HDMI

I own the Panasonic DMP-BD35K blue ray player and the Sony STR-DE845 receiver.  The receiver doesn't have an HDMI input, but rather an optical audio input. Do I need a receiver with HDMI inputs to get the high quality audio benefits from the BD player?  Also, do I need a different receiver to decode different sound formats from my BD player, or will my BD player decode the audio, and output it through my receiver?  I'd appreciate any help or guidance.  Thanks!
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If your receiver doesn't have 7.1 analog outputs like the Sony S550 and you don't have an HDMI, then you're out of luck.
However, even if you're not getting TrueHD or DTS-MA, you're still getting better than average audio. DVDs typically encode DD at 448kB/s and DTS at 768 kB/s. BluRay encodes "core" DD and DTS tracks that play through the optical and digital coax outputs (then the additional data for uncompressed audio is added on the HDMI output only).
These "core" tracks are created using the max DD and DTS bitrates however, since space is not an issue. So DD tracks are 640 kB/s and DTS tracks are 1.5Mb/s. 
To my ears, this is a decent improvement on most systems (~$1,000 total system cost and up) and if you've got good ears. To hear the difference in stepping up to the TrueHD and DTS-MA I would say you'd want at least $4-5,000 in speakers to really appreciate the difference. Otherwise it wouldn't be worth the cost imho.

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